Problem 2:ForesCompany had the following balances on December 31, 2020:Cash in RC Bank -savings accountCash in MB Bank - current accountCash in PS Bank - time deposit, deposited on October 15, 2020,matures on January 10, 2022Cash on handTreasury bills, purchased on DecemberP1,000,000(1,500,000)1,500,000500,00029, 2020 and due on March 25, 20211,000,000Money market instruments, purchasedon September 1, 2020 and due on March 1, 20211,000,000500,000Postal money orderAdditional information:The cash in RC Bank was opened to in connection with a borrowing arrangement and has to maintain P500,000at a minimum. However, part or all of this P500,000 can be allowed to be withdrawn if Forest can earn a totalsales amount of P10,000,000 during the first quarter of 2021.22. How much should appear as cash and cash equivalents in the balance sheet of forest Company as ofDecember 31, 2020?

Cash and Cash Equivalents include cash and highly liquid assets convertible into cash.

Problem 2: ForesCompany had the following balances on December 31, 2020: Cash in RC Bank -savings account Cash in MB Bank - current account Cash in PS Bank – time deposit, deposited on October 15, 2020, matures on January 10, 2022 Cash on hand Treasury bills, purchased on December 29, 2020 and due on March 25, 2021 P1,000,000 (1,500,000) 1,500,000 500,000 1,000,000 Money market instruments, purchased Postal money order September 1, 2020 and due on March 1, 2021 1,000,000 500,000 Additional information: The cash in RC Bank was opened to in connection with a borrowing arrangement and has to maintain P500,000. at a minimum. However, part or all of this P500,000 can be allowed to be withdrawn if Forest can earn a total sales amount of P10,000,000 during the first quarter of 2021. 22. How much should appear as cash and cash equivalents in the balance sheet of forest Company as of December 31, 2020?

Problem 2: ForesCompany had the following balances on December 31, 2020: Cash in RC Bank -savings account Cash in MB Bank - current account Cash in PS Bank – time deposit, deposited on October 15, 2020, matures on January 10, 2022 Cash on hand Treasury bills, purchased on December 29, 2020 and due on March 25, 2021 P1,000,000 (1,500,000) 1,500,000 500,000 1,000,000 Money market instruments, purchased Postal money order September 1, 2020 and due on March 1, 2021 1,000,000 500,000 Additional information: The cash in RC Bank was opened to in connection with a borrowing arrangement and has to maintain P500,000. at a minimum. However, part or all of this P500,000 can be allowed to be withdrawn if Forest can earn a total sales amount of P10,000,000 during the first quarter of 2021. 22. How much should appear as cash and cash equivalents in the balance sheet of forest Company as of December 31, 2020?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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